Citigroup must face $1 billion lawsuit claiming it aided Mexican oil company fraud

Written by Jonathan Stempble

(Reuters) -Citigroup must face a revival lawsuit claiming to have caused more than a billion dollars of losses by organizing and hiding vast fraud in the Mexican and Mexican banking company.

A committee of three judges from the Court of Appeal in the eleventh American district in Miami said that 30 seller, or a creditist, and bond holders adequately claimed that City Group greatly helped fraud, and the minimum judge of the court erred in rejecting the nine -year -old case.

Daniel Romero Apillos, a spokeswoman for City Group, rejected the comment. Juan Morillo, a prosecutor’s lawyer, said his clients are grateful for the decision.

The Citigroup Banamex unit has provided cash progress to Oceanografia, which provided drilling services to the Mexico -owned Mexican Petroleum Oil Company, and the interest payments collected to progress.

Prosecutors, including shipping and rental companies, investment funds and Rabobank in the Netherlands, said Citigroup has advanced 3.3 billion dollars to Ochenography between 2008 and 2014 despite knowing that the company has a lot of debts and was making PeMEX signatures on authorization models.

Citigroup later found nearly $ 430 million in fraudulent cash progress, and was fined $ 4.75 million by the US Securities and Exchange Committee in 2018 on the internal controls of Banamex.

Michael Korbat, former CEO of City Group, said that the bank launched 12 employees, and Mexican organizers said that 10 bank employees bear a criminal responsibility under Mexican law.

In a 82 -page resolution, the Porter Grant’s judge found enough allegations that Citigroup blocked major information about Oceanografia from the plaintiffs, while providing payment payments in a financial incentive.

“Citigroup is one of the most developed financial institutions in the world, and credibility is ashamed that assuming that the claimants’ allegations are correct, Citigroup lacks awareness of the activities of Oceanografia,” she added.

The court returned the case to the American boycott judge, Darren Giles, in Miami, who rejected it in August 2023.

The case is Otto Candies Llc Et Al V Citigroup Inc, the eleventh court of the American Chamber, No. 23-13152.

(Participated in the reports of Jonathan Stempble in New York; edited by Richard Chang)